Eight seconds to explain why prospects should buy what you’re selling
Your startup’s value proposition is like its heartbeat. If it’s not clear and consistent, you risk an uncertain future.
Apply a five-step process to create a value proposition that explains what you’re selling in eight seconds and engages prospects to learn more.
I recently met a UK startup founder at an industry event. We started chatting, and I asked him the age-old question: “So, what does your company do?”
He responded with a three-minute ramble that included buzzwords like AI, distributed Cloud, and hyper automation. It ended with something about him dethroning Google and Facebook, because, well, “they’re useless, aren’t they?”
I smiled politely, still having no idea what the company did, and moved on to more cocktails and canapés.
‘Word salad’ is no way to communicate with customers
It occurred to me: how often do startups communicate with target customers in the same way? They spout off ‘word salad’ and expect prospects to understand why they should buy what the company is selling. Big mistake.
Attention spans are shorter than ever. If you can’t explain to your target customers in eight seconds what problem you solve, for who, and why you’re better than the competition, you’ve lost them. Maybe for good.
Your answer to the question, ‘What does your company do?’ is your value proposition. It sits at the heart of every business. It impacts your sales and marketing, your product development, and your organisation.
Without a clear value proposition, you’re like a rudderless boat stranded in the ocean that goes where the waves take it. Get your value proposition right, however, and you’re in control of what direction you sail.
How to create a value proposition even a 12-year-old understands
So, how do you create a value proposition that even a 12-year-old will understand? Let’s see through the example of Antavo, an enterprise loyalty platform:
1. What problem does my business solve or need does it fulfil?
Answer this question in the voice of your target customer, so you put yourself in their shoes. “I wish I had….”, “I need…”, and “I have to….” are all great ways to start a sentence.
At Antavo, the customer says: “I need a loyalty program that’s customisable and easy to integrate.”
2. Who is my target customer?
If you’re in the B2B space, first define the type of companies you want to reach. Include ‘hard’ parameters, like industry, size, and location and ‘soft’ qualities like ‘struggling with sales’ or ‘appreciates quality over quantity.’
Then move on to define the individual decision-maker. In B2B, this is the person who has the authority and budget to say ‘yes.’ Identify job titles of people who would be interested in your offer – like ‘Marketing Director’ or ‘Head of Logistics’.
Antavo targets global enterprises and engages with the ‘Head of Loyalty’ or ‘Director of Customer Marketing’ at these companies.
3. How do I describe my company, product, or service in three or four words?
Simplicity is key. Make sure to use everyday language. Avoid buzzwords that make people stop and think, so they don’t lose sight of what’s important.
Antavo calls itself a ‘pure-play loyalty technology’. Short and sweet.
4. What is my product or service’s key benefit?
List all the benefits of using your product or service. It may generate new revenues, save time, or improve operating efficiency. Then, zero in on the one benefit that has the biggest impact on your target customer’s business or life.
In B2B, your business’ ability to add revenues or save costs will put you in the ‘need to have’ category. Benefits like saving time and improving efficiency, while valuable, usually put you in the ‘nice to have’ bucket. This category is often put on hold during tough economic cycles.
Antavo’s key benefit? It enables customers to create tailored loyalty programs based on 10 types, including experience-based concepts that engage customers outside of the buying cycle.
5. What makes your product or service unique or compelling?
Now identify your competitive advantage: the one thing that separates you from the pack.
Your competitive advantage comes from one of two things. First, it may be a benefit that you listed under question four that makes you unique. In this case, you’ll list one of your benefits as your key benefit, and the other one as your competitive advantage. Second, it may come from how you deliver your solution. This may be a unique process or methodology that you use to bring your product or service to life.
Antavo’s competitive advantage falls into the second category. The API-based, no-code technology reduces reliance on IT teams, and makes the customer’s loyalty programs easy to manage and integrate.
Create your sentence using your building blocks
You now have the building blocks to create a single-sentence value proposition. Using Antavo as an example:
§ Problem: “I need a loyalty program that’s fully customisable and easy to integrate”
§ Target customer: global enterprises
§ Product/service description: pure-play loyalty technology
§ Key benefit: enables customers to create tailored, experience-based loyalty programs
§ Competitive advantage: API-based, no-code technology reduces reliance on IT teams
Take these pieces and apply them to a simple sentence structure.
[Company Name] is a [Product/Service Description] that helps [Target Customer] to [Key Benefit] by [Competitive Advantage].
[Antavo] is a [pure-play loyalty technology] that enables [global enterprises] to [create tailored, experience-based loyalty programs] using [API-based, no-code technology that reduces reliance on IT teams].
You may have to adjust one or two elements of your value proposition to make it work grammatically, like replacing ‘helps’ with ‘enables’ as I’ve done here. You may also realise that certain building blocks don’t fit together quite the way you thought. In this case, go back to the questions, rethink your answers, and rewrite your sentence.
Don’t make these value proposition mistakes
As you go through this process, make sure you avoid these three typical mistakes.
1. You highlight your product features, but not its benefits.
Don’t tell me what you offer without explaining why I should care.
2. Your target customer is unclear or too broadly defined.
Don’t try to be everything to everybody. You’ll end up meaning nothing to nobody.
3. You include industry buzzwords that cloud your message.
Don’t ‘wow’ me with the latest jargon. Speak to me like a human being instead.
Creating a value proposition is a process
Once you’re happy with your value proposition, test it in the real world. Include it in your emails to prospects. Incorporate into your website and sales materials. You’ll find that certain elements resonate, while others need fine-tuning.
Don’t get discouraged if you don’t get your value proposition right the first time. It’s likely that you’ll need to test several versions before you start seeing its impact. Eventually, you’ll create a clear message that resonates with your target customer.
And you’ll not only easily answer the ‘what does your company do?' question at events, you’ll also find your target customers will want to engage and learn more.